Hindsight is a wonderful thing, but there’ll still be red faces all round in Helsinki after it’s revealed that Nokia could’ve pre-empted the iPhone – at least in terms of hardware – several years before the Apple smartphone hit the market. Ex-Nokia manager Ari Hakkarainen has been talking to the NYTimes, and claims the company demonstrated a big-display, full-touchscreen smartphone to business customers back in 2004, but that development was axed over fears of the project’s cost. Meanwhile, Nokia execs supposedly rejected proposals for an App Store like online software marketplace in the same year.

“It was very early days, and no one really knew anything about the touch screen’s potential. And it was an expensive device to produce, so there was more risk involved for Nokia. So management did the usual. They killed it.” Ari Hakkarainen

In fact, the picture Hakkarainen paints is of a company hamstrung by their legacy of “traditional” devices and a management structure overly cautious about change. It’s a view shared by ex-Nokia UI designer Juhani Risku, who claims his team put forward 500 proposals for updating Symbian in his eight years at the firm, none of which was accepted by the “Soviet-style” bureaucracy. One example is a 3D UI, developed back in 2002, which was supposedly rejected for potentially adding $2.05 to the cost of each handset.

For their part, a Nokia spokesperson dismissed the complaints as generalistic, suggesting the ex-employees were “managers with individual roles or leaders of small teams,” and saying that, while “I am sure there are things we could have done better and innovations we missed … that happens to all companies. We have been very successful with some other innovations.” It remains to be seen whether new CEO Stephen Elop will be able to turn the Nokia ship around.